WooSox stadium deal about more than numbers
Bruce Mendelsohn.
While I'm a Worcester booster and a fan of all Sox, Red, Woo and Paw, I'm also a fan of fiscal prudency, and the hard numbers reinforce experts' pessimism about Polar Park. However, the deal's success – or failure – transcends numbers.
City leaders say Canal District stadium project will generate sufficient tax and rental revenue to cover taxpayers' cost and create an additional $3 million annually for the city.
Worcester would own Polar Park, but the team will keep advertising, concession and naming rights revenue. Worcester anticipates revenue from property taxes (but not on the stadium itself), local option sales taxes, hotel room taxes, parking, advertising, team rent, and up to 125 events per year at the park.
Looking solely at the numbers, this ain't a good deal. Depending on how we define economic benefit, it may turn out to be a bad deal.
Shortly after the deal was announced, WBJ shared the financing details with sports management professors to evaluate city leaders' claims that the stadium development would pay for itself. Nine of the 10 economists who reviewed the numbers doubted the claim.
The sole dissenting opinion came from Smith College Economics Professor Andrew Zimbalist, a consultant Worcester paid to help seal the deal. Zimbalist's economic model showing the deal to be “better than financially neutral for the city under reasonable assumptions.”
City leaders seized upon Zimbalist's lukewarm endorsement to hype the project as transformative, but when the hype and crowds inevitably subside, we may discover the future home of the Pawtucket Red Sox is built on a shaky financial foundation. Ironically, Zimbalist's endorsement contradicts conclusions from his 2011 book “Sports, Jobs and Taxes: The Economic Impact of Sports Teams & Stadiums”. He and co-author Roger Noll found:
1) Sports teams and facilities are not a source of local economic growth and employment;
2) The magnitude of the net subsidy exceeds the financial benefit of a new stadium to a team;
3) The most plausible reasons cities (like Worcester) subsidize sports teams are the intense popularity of sports among a substantial proportion of voters and businesses.
It might not make sense from a profit-and-loss perspective, but equating a city's or region's prominence or value with winning teams produces benefits beyond dollars and cents. Successful sports teams generate palpable civic pride, which Worcester could use more of.
The redevelopment project may generate net funds to support additional city services in education, infrastructure and security. There'll be plenty of parking for residents and visitors to go to Polar Park and root, root, root for the WooSox. Kelley Square will be navigable.
Let's hope the project brings Worcester positive publicity, more profits and at least a couple victory parades.
Bruce Mendelsohn is the CEO of marketing firm The Hired Pen. Reach him at bruce.mendelsohn90@gmail.com.
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